Types of Federal Student Aid

Summary

This video explains how the Office of Federal Student Aid can help students pay for college or career school, offering over $150 billion annually in grants, loans, and work-study funds. It covers key aspects such as federal grants, which don't need to be repaid, and federal student loans, which have lower interest rates and flexible repayment options. Additionally, it highlights the benefits of work-study jobs and various ways to manage loans, including deferral, tax deductions, and loan forgiveness based on employment. For more information, students are encouraged to visit studentaid.gov or contact their school's financial aid office.

Takeaways

• 😀 Federal Student Aid offers over $150 billion annually to help pay for college and career school.
• 😀 The FAFSA (Free Application for Federal Student Aid) is the first step in applying for financial aid.
• 😀 After completing the FAFSA, students will receive an award letter outlining available financial aid from schools.
• 😀 Federal grants do not need to be repaid, providing valuable assistance with school costs.
• 😀 Federal student loans must be repaid with interest, but often have lower fixed interest rates than private loans.
• 😀 Federal student loans offer repayment options tailored to individual needs and may include income-based plans.
• 😀 Students may be able to defer loan payments, deduct interest on taxes, or consolidate loans for easier management.
• 😀 Federal loans can sometimes be forgiven based on certain types of employment, providing long-term relief.
• 😀 Work-study programs provide opportunities for eligible students to earn at least minimum wage while studying.
• 😀 For additional questions or support, students can contact the financial aid office at their school or visit studentaid.gov.

Q & A

What is the Office of Federal Student Aid?

The Office of Federal Student Aid is a government agency that provides financial assistance to students to help pay for college or career school, offering more than $150 billion each year in grants, loans, and work-study funds.

What types of school expenses can federal student aid cover?

Federal student aid can be used to cover various school expenses, such as tuition, room and board, and books and supplies.

How do students apply for federal student aid?

Students apply for federal student aid by filling out the Free Application for Federal Student Aid (FAFSA). After submission, students will receive an award letter from the schools they listed on their FAFSA, detailing available financial aid options.

What is a federal grant, and do students need to repay it?

A federal grant is a form of financial aid that students do not need to repay, which can help cover school costs. Students who qualify for federal grants will receive this aid as part of their financial support package.

What is a federal student loan, and how does it work?

A federal student loan is money borrowed from the government to help pay for school expenses. Like any loan, it must be repaid with interest. However, federal student loans generally offer lower fixed interest rates compared to private loans and come with additional benefits.

Why should students consider federal student loans over private loans?

Students should consider federal student loans because they typically offer lower fixed interest rates and additional benefits such as flexible repayment options, income-driven repayment plans, and possible loan forgiveness based on employment type.

What repayment options are available for federal student loans?

Federal student loan repayment options include various plans tailored to individual needs. These may include income-driven repayment plans, which adjust monthly payments based on a student's income.

Can federal student loan payments be deferred or consolidated?

Yes, federal student loan payments can be deferred, and students may also be able to consolidate eligible federal student loans into one loan with one monthly payment.

What is work-study, and how does it help students pay for school?

Work-study is a federal program that provides eligible undergraduate and graduate students with part-time jobs to help pay for their education. Students earn at least the minimum wage and can use the money for school-related expenses.

Where can students get more information or assistance about financial aid?

Students can contact the financial aid office at their college or career school or visit the official website at studentaid.gov for more information and assistance regarding financial aid.